EANS-Adhoc: Ad hoc Announcement Pursuant to § 15 WpHG (German Securities Trading
Act): Epigenomics AG Announces Restructuring of U.S. and European Operations
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ad-hoc disclosure pursuant to section 15 of the WpHG transmitted by euro
adhoc with the aim of a Europe-wide distribution. The issuer is solely
responsible for the content of this announcement.
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Company Information/molecular diagnostic
10.08.2011
Berlin, Germany, and Seattle, WA, U.S.A., August 10, 2011 - Epigenomics AG
(ISIN: DE000A1K0516) today released plans to restructure its organization and
heighten the focus of its activities on the key U.S. market. Operations at the
Epigenomics AG headquarters in Berlin, Germany, as well as at its subsidiary
Epigenomics Inc. in Seattle, WA, U.S.A., are affected by the restructuring
plans. However, the development of Epigenomics' second generation blood test for
colorectal cancer ("CRC") detection, Epi proColon® 2.0, remains on track. The
launch of the product in Europe and a submission to the U.S. Food and Drug
Administration (FDA) for Premarket Approval review are planned before year-end
2011.
Following a strategic review of the commercial opportunity presented by Epi
proColon® 2.0 in the key U.S. market, plans for developing a commercial
operation in the U.S. are being accelerated. The Company will relocate its U.S.
headquarters from Seattle, WA, to the East Coast in 2012 and step up efforts to
prepare for a commercial launch. Research activities will be scaled down
substantially and integrated into the development department. Going forward,
European commercialization will be mainly focused on key accounts. Epigenomics
plans to reduce its total workforce by approximately 39 employees targeting a
company size of 45 employees by year end 2011.
Specifically, Epigenomics will implement the following key changes to the
organization:
* From 2012 onwards, the U.S. headquarters will be relocated to a new business
site, strategically located on the East Coast, as the nucleus for building and
growing the U.S. commercial operations while retaining key Seattle staff in a
satellite office.
* Direct commercialization in the European self-payer segment will be
de-emphasized and a key account approach for Epi proColon® and Epi proLung®
directed towards institutions such as healthcare providers, health insurers and
further large institutional customers will be implemented to generate
sustainable revenues in the mid to long term. The European sales and marketing
team will be adjusted accordingly.
* Early stage product and technology research will be discontinued and clinical
research scaled down and remaining R&D resources will be concentrated on second
generation product development and support of existing products.
* Biomarker discovery and development capabilities will be maintained for
collaborations with pharmaceutical companies in the area of personalized
medicine.
* Further cost savings will be realized through scaling down administration and
management in proportion to new company structure.
These measures are expected to be fully implemented by the end of 2011 and to be
mainly reflected in the annual accounts of 2011. The Company intends to reduce
the total workforce from 84 employees at the end of H1 2011 to approximately 45
employees by year-end 2011. Starting in 2012, the Company expects to further
grow its U.S. commercial operations to prepare for an Epi proColon® 2.0 product
launch after the potential Premarket Approval by the FDA. Going forward,
Epigenomics expects to realize annual savings on a comparable operational cost
basis of approximately EUR 3.5-4.0 million. One-time restructuring costs are
expected to be in the range of EUR 3 million, of which approximately EUR 0.7
million will not affect liquidity. The measures in connection with the
restructuring plan will accelerate cash outflows in 2011 and the company expects
to end the year with around EUR 13 million in liquid assets. However, net cash
outflows in 2012 will decrease accordingly. The management estimates that the
existing liquid assets will fund the Company's operations well into 2013.
An updated guidance reflecting the effects of the restructuring and cost saving
measures will be provided at the time of the 9-Months Financial Report.
* End of Ad hoc Release -
Further Information
Epigenomics AG today issued a press release on its 6-Months Financial Report and
its restructuring plans. The press release is available at Epigenomics' website
at: http://www.epigenomics.com/en/news-investors.html
The 6-Months Report 2011 can be obtained from Epigenomics' website at:
http://www.epigenomics.com/en/news-investors/investors/financial-reports.html
Conference call for press and analysts
Epigenomics' management will host a conference call at 3pm CET/9 am EST today,
Wednesday 10th August 2011. The dial-in numbers for the conference call are:
Dial-in number (within Germany): +49 30 86871428
Dial-in number (within the UK): +44 203 3679216
Dial-in number (within the U.S.): +1 408 9169838
Participants are kindly requested to dial in 10 minutes prior to the start of
the call.
The presentation accompanying the conference call will be available for download
on the Epigenomics' website: http://www.epigenomics.com/en/news-investors.html
A webcast of the conference call will be provided on Epigenomics' website
subsequently: http://www.epigenomics.com/en/news-investors.html
Epigenomics legal disclaimer
This communication expressly or implicitly contains certain forward-looking
statements concerning Epigenomics AG and its business. Such statements involve
certain known and unknown risks, uncertainties and other factors which could
cause the actual results, financial condition, performance or achievements of
Epigenomics AG to be materially different from any future results, performance
or achievements expressed or implied by such forward-looking statements.
Epigenomics AG is providing this communication as of this date and does not
undertake to update any forward-looking statements contained herein as a result
of new information, future events or otherwise.
The information contained in this communication does not constitute nor imply an
offer to sell or transfer any product, and no product based on this technology
is currently available for sale by Epigenomics in the United States or Canada.
The analytical and clinical performance characteristics of any Epigenomics
product based on this technology which may be sold at some future time in the
U.S. have not been established.
Further inquiry note:
Dr. Achim Plum
Sen. VP Corporate Development
Epigenomics AG
Tel: +49 30 24345 368
achim.plum@epigenomics.com
end of announcement euro adhoc
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issuer: Epigenomics AG
Kleine Präsidentenstraße 1
D-10178 Berlin
phone: +49 30 24345-0
FAX: +49 30 24345-555
mail: ir@epigenomics.com
WWW: www.epigenomics.com
sector: Biotechnology
ISIN: DE000A0BVT96, DE000A0XFWF2
indexes: Prime All Share, Technology All Share
stockmarkets: regulated dealing/prime standard: Frankfurt, free trade: Berlin,
Hamburg, Stuttgart, Düsseldorf, München
language: English